Procurement Act amendments and BPP’s observations

Last week Tuesday, the Senate Committee on Public Procurement conducted public hearing session on amendments it seeks in some of the provisions of the 2007 Public Procurement Act (PPA) but the Bureau of Public Procurement (BPP) raised some vital observations. Taiye Odewale reports.

Bills and amendment to Procurement Act

The journey for the Public hearing session by the Senate Committee on Public Procurement on amendments of some provisions of the Public Procurement Act ( PPA) 2007, began on Thursday, November 14, 2019, when the Senate in plenary, mandated it to do so, on the strength of three different bills sponsored, debated and passed for second reading to that effect .

The three bills were combination of an executive one and two separately sponsored by Senators Uche Lillian Ekwunife (PDP Anambra Central) and the chairman of the Committee, Senator Shuaibu Lau (PDP Taraba North).

During debates on the consolidated bills separately titled: “A bill for an Act to amend the National Council on Public Procurement and Bureau of Public Procurement Act 2007 and other related matters”, virtually all the Senators who contributed, supported the move for amendments of problematic provisions of the Act, which, according to them, will frustrate the implementation of the 2020 budget, if not urgently amended.

Act as stumbling block

Specifically, Senator Shuaibu Lau, said “the Public Procurement Act, 2007, which was signed into law on June 4, 2007, is currently the root cause of most of the corruption in public procurement in Nigeria.” 

The lawmaker said the proposed bill seeks to remedy these anomalies by amending 59 sub-sections and introducing 90 new sub-sections to the existing act. He added that a proposed additional amendment of Section 1 of the act is being introduced to prescribe those eligible to be appointed by the president into the position of the chairman of the National Council of Public Procurement.

The bill proposes “A former president or retired Chief Justice of the Federation” as an appointee eligible for consideration as chairman of the National Council of Public Procurement. 

The bill also proposed that membership of the committee must include the Minister of Finance, Budget and National Planning, the Attorney-General of the Federation and Secretary to the Government of the Federation. 

The bill, among others, seeks to provide term of office and removal from office for members of the Council which are not provided for in the existing act.

The bill also seeks for   increase of mobilisation fee for contractors from 15 percent provided for in the 2007 Act, to 30 percent of the contract sum in the planned  amendment to stop abandonment of contracts.

This is as it also seeks also for stiff penalties against contract splitting by ministries, departments and agencies (MDAs), in the amendments bill.

Act abetting corruption

Linking the Act to corruption, Senator Barkiya Abdullahi Kabir (APC Katsina Central), said “The 2007 Public Procurement Act going by its various loopholes, is an extension and facilitation of corruption in the country”.

In his own remarks, the President of the Senate, Ahmad Lawan, said the act must be amended if effective implementation of the 2020 budget must be achieved. 

According to him, expeditious consideration given the 2020 proposals will be given the planned amendments of the bill as a way of giving the 2020 budget implementation a smooth sail.

He said: “Twelve years down the line, we have seen the strengths and weaknesses of the Act. Certainly, the last twelve years have revealed the inadequacies and loopholes that are in the act. 

“When we pass the Appropriations Bill 2020 before the end of the year, and the implementation commences from January, if this Act remains as it is today with unnecessary cumbersome processes of bidding, the time we would have gained from passing the budget will be lost in processing the budget for implementation. 

“Just like we gave expeditious treatment to some of the bill passed recently, this is also important and significant because it will add value to the implementation of the 2020 Appropriations bill and so many issues that were raised about the weaknesses in the Procurement Act.”

Amendment chance to clear cobwebs

The Senate President repeated same at the public hearing session last week through a speech read on his behalf by the Leader of the Senate, Senator Yahaya  Abdullahi.

Abdullahi in the speech said: “This public hearing on the Public Procurement Act is an opportunity to clear the cobwebs in the laws which crept in on account of inherent loopholes. Somehow and somewhere, some lacunas got in to undermine the process, making the laws not to achieve what it was intended for within the last 12 years”.

BPP raised objections

However in his submissions at the public hearing, the Director General of Bureau of Public Procurement (BPP), Mamman Ahmadu, picked holes in five different areas of the intended amendments.

One of them is the administrative function the proposed amendment seeks to confer on the National Council on Public Procurement which he said is against global practices.

He said: It appears that the draft amendment seeks to confer administrative functions to the National Council on Public Procurement. This proposal is fundamentally against the global principle of corporate governance which prohibits councils/boards from participating in day-to-day activities Agencies/organisations that they supervise; 

“The Public Procurement Act, 2007 was patterned adhere to the United Nations Commercial International Trade Law (UNCITRAL) Model Law on Publlc Procurement, which Is one of the most globally accepted public procurement model law. However, the proposed amendments to the PPA 2007 is in direct conflict with some basic principles of the UNCITRAL model Law particularly the proposal that advertisements should be for 2 weeks for national competitive bidding and 4 Weeks for International competitive bidding. The UNCITRAL recommends 4 to 8 weeks for advertisement to enable bidders prepare their tenders properly.

“The proposal to extend the functions of procurement departments in the procuring entities to include monitoring of projects is not correct, the skills for project monitoring are not a requisite to become a procurement officer and as such there is no guarantee that procurement officers shall execute this function effectively.

‘The proposal to use honourable ministers to chair technical evaluation committee is not consistent with the principle of using technical personnel with the experience in the area of that procurement. This proposal will also undermine the office of the honourable minister as the recommendations of the technical evaluation committee shall be subjected to the approval of the tender’s board. Also, the UCITRAL Law seeks to limit the role of politically exposed person to the procurement value chain. 

“The proposal that investigations of procurement related cases should be forwarded to the council may compromise the outcome of such investigations. Furthermore, investigative agencies are statutorily empowered to conclude their investigations and prosecute where criminality is established”.

Expert picks holes in mobilisation fee

The immediate past BPP Director General, Engr Emeka Ezeh, also picked holes in some of the proposed amendments particularly as regards upward review of mobilization fee for contractors from 15 to 30 percent.

Financial capacity of contractors, according to him, is best tested with the 15 percent mobilisation fee and not 30 percent which will be abused by financially handicapped contractors. Besides, the global practice is 25 percent and not 30 percent”, he said.

With the end of the public hearing session, whether the observations made by the BPP at the session will be factored into the final report of the committee or not, is in the womb of time. 

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